Mortgage credit availability increased in July,
according to the Mortgage Credit Availability Index (MCAI), a report from the
Mortgage Bankers Association (MBA) that analyzes data from Ellie Mae’s All Regs
Market Clarity business information tool.
The MCAI increased 2.9 percent to 125.5 in
July. A decline in the MCAI indicates that lending standards are
tightening, while increases in the index are indicative of a loosening of
credit. Of the four component indices, the Conventional MCAI saw the greatest
loosening (up 5.2 percent over the month) followed by the Jumbo MCAI (up 4.7
percent), the Government MCAI (up 0.9 percent), and the Conforming MCAI (up 0.4
percent).
“Credit availability increased in July, mainly
driven by higher-balance loan programs,” MBA’s Chief Economist Mike Fratantoni said.
“Many investors are fine tuning their
cash-out refinance requirements to meet increasing borrower demand for home
equity financing. Some investors increased the availability of low downpayment
loans.”
Credit availability, as measured by the MCAI, has
been steadily rising since the fall of 2014, when it bottomed at 113.2 in
October. It was at 122.0 in June and 122.6 in May as credit standards continued
to loosen since the start of the year.